GoPro Quits Drone Market & Cuts Jobs

GoPro CEO says he'd consider a sale, but is still planning to be independent

Shares of GoPro tumbled 21 per cent to $5.94 at 11:30 NY and earlier fell as low as $5.04, the most since the IPO. The company will be cutting staff numbers and exiting the drone market.

"I can confirm that JPMorgan is in fact our banker, but we have not engaged them to help us sell the company", said Woodman.

Various news sources started reporting that the sports camera manufacturer had hired JP Morgan to assist with a sale process.

"If there are opportunities for us to scale awareness of GoPro globally by being part of a bigger company, that's something that we would entertain", CEO Nick Woodman told CNBC Monday morning.

However, he also said, "Of course, we need to run the business as though we're going to be independent, and we're planning accordingly".

Back in its hey-day (October 2014), the company's share price was around $US87, which is 17 times higher than its current value.

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In particular, the company forecast its revenue will fall sharply by 37 per cent to $US340 million, which is far short of Wall Street estimates (of a more lofty $US472 million). Midway through the holiday season, GoPro slashed prices on some camera models, which lifted sales but lowered profit margins.

GoPro is planning to re-structure through an $80 million cost-cutting program, which will see least 255 employees lose their jobs to achieve a headcount of "fewer than 1,000 employees worldwide".

The move comes as GoPro looks to return to profitably from its struggling business, although the company's CEO stated earlier on Monday that the company would be interested in a potential merger or acquisition of the firm. It also doesn't have the cash to make an acquisition and probably won't anytime soon.

Shares of GoPro were down 19 percent in midday trading, after the camera maker said it was laying off around 20 percent of its workforce.

Among 23 analysts covering GoPro Inc (NASDAQ:GPRO), 5 have Buy rating, 6 Sell and 12 Hold. LLC bought a new position in GoPro in the 3rd quarter worth $122,000. Short interest averaged $269 million, according to S3 data, and it peaked at $361 million on November 1. Woodman said sales did improve somewhat after GoPro cut the price of the Hero5 on December 10.

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